New figures from retail researcher Kantar Worldpanel showed the chain, which saw profits plunge by 52% to £354M last year, had increased its sales by 0.6% in the 12 weeks to June 21.
After the sales growth was announced, city analyst Shore Capital revealed it had been appointed as one of three brokers to the firm.
Clive Black, Shore Capital director and head of research, recently defended Morrisons’ manufacturing facilities and has, in the past, highlighted them as one of the retailer’s key strengths.
Shortly after Potts was appointed as Morrisons’ boss in March, Black urged him to “weaponise” the retailer’s manufacturing facilities.
He said: “We sense that Potts will seek to extol the vertical integration, ‘Market Street’ and Morrisons’ Yorkshire and British heritage to maximum effect.”
First market share gain
As a result of its sales growth, Morrisons had also boosted its market share by 0.1% to 11%. While it was a small gain, it represented the retailer’s first market share growth since December 2011, said Kantar Worldpanel head of retail and consumer insight Fraser McKevitt.
“Last seen in November, the return to marginal decline across the grocery market reflects both falling prices and only steady volume growth,” McKevitt said.
“Sales volumes are up 2% compared with a year ago, but are not anticipated to accelerate, even with an improving economy, as demand for groceries has remained steady before the recession.”
Morrisons’ sales growth, however, had not been repeated among the other big four, McKevitt added.
Tesco and Sainsbury both saw sales fall by 1.3%, which plunged their market share by 0.3% to 28.6% and 0.2% to 16.5% respectively in the 12 weeks to June 21.
Asda’s sales plummeted by 3.5%, which left the retailer with a 16.5% share of the market for the same period, McKevitt said.
Co-op sales were flat
In contrast, the Co-operative’s sales were flat, but ahead of the market for the first time in four years as a result of more shoppers visiting its stores.
Despite recent predictions by city analysts that Aldi and Lidl would see a slowing in their growth, they had continued to take market share from the big four, said McKevitt.
“The two discounters, Aldi and Lidl, increased their sales by 15.4% and 9.1% respectively,” he explained. “Aldi reached a new high with a 5.5% share of the market, while Lidl, also showing continued growth, rose to 3.9%.”
Waitrose also grew ahead of the market, with a 1.2% sales increase, which secured the posh retailer a 5.1% share of the market.
Meanwhile, the continued growth of the discounters Aldi and Lidl would result in the merging of one or more of the big four supermarkets, Julian Wild, head of the food team at Rollits solicitors told FoodManufacture.co.uk.